What is e Commerce? e commerce is enabling or achieving your business objectives by using information technology to enhance or transform your business processes. Kami, 2000
e commerceBusiness to business (B2B) automating supply increasing business efficiencyBusiness to Consumer (B2C) Retail Sales Customer SupportConsumer to Consumer (C2C) Online Auctions
eCommerceecommerce is more then just an online shop selling goods…. Businesses make huge savings by more efficient interaction with their suppliers or buyers. A local pharmacist orders 60% of his supplies from an overseas pharmaceutical suppliers website and saves 5% in his purchases - is this ecommerce? A remote Fiji resort attracts guests from the USA after several exchanges of email. Is this ecommerce?
Global400 million users of Internet worldwide1999 US online retail sales - US$20bn. Forrester Research2000 US online retail sales - US$30bn+ Forrester ResearchUS Online buying will reach US$6.9 trillion 2004. Forrester Researchelectronic payment of bills and banking will cost US Postal Service $17bn over 10 years.
Interpretation ?Consumers are willing to spend money on online transactions.Despite the recent dot.com drop in investment - consumers continue to use the Internet in growing numbers.The US figures are only part of the global picture.
What is working? Pornography Travel / Tourism Retail - items that don’t need personal touch - objectivity in product quality and performance music, books, gifts, Computers, electronic items Auctions Real Estate - houses and investment properties. Customer support services More efficient and effective processes between businesses (B 2 B)
What is not working?Items which require “touch and trial” Luxury goods Clothes - beyond TshirtsGroceries - it works for some people but market is restrictedNote: Many OFF line factors determine success of Online service. Eg. Transport network, customer profiles,
e commerce and thePacificTraditional BarriersIsolation – distance from marketSmall local marketsLimited human capacityOpportunityInternet provides “instant” access to global market
ecommerce adoption inPacificTourism small operators and multi nationals expatriate owned businesses due to better awareness of communications possibilities.Online retailers - often overseas based, some Pacific based exporters.Generally for the Pacific it has been ad hoc entry with ecommerce/
Lessons from experiencePopular Sites Not = Revenue Online Advertising Market is immature especially in the Pacific. What visitors do on a website is more important then inflated “hits” figures Income models based on advertising must be supported by online sales.Start with a strategy know your market and how to reach themTraditional Off line issues determine profitability management, product, operations and financing.
e Commerce and PacificThe challenge is identify market niches for products unique to the Pacific (core competencies) EcoTourism, trade niches, island goods Identify skill industries where local capacity can be developed and product transferred electronically. (insurance, banking, drafting etc)Avoid entry in IT labor market - call centers, credit card processing without an exit plan because these IT niches will be the world’s most MOBILE industries and governed by cost of labor.
Demonstrations - TourismTourism: www.tongaonline.com/sailingsafaris Sailing Safaris - Tonga One boat operation in 1996 from small island base Competing with 2 multinational yacht companies with global marketing network Since 1997 - 80% of business from web site. This statistic 60-80% of bookings from web inquiries is common to Tourism operators in the Pacific.
Example 2 - TourismPacificnavigator.com - Travel PortalOne stop shop for travel info and bookings.9 Pacific Island CountriesTravel Information and BookingsSticky Items - bring people back to site message boards for comments News Postcards
Example 3 - RetailWww.Fijilive.com - Portal Popular site and daily local news. immature advertising market – difficult to get local advertisers. Sticky Features News Numerous in-house websites sells through www.fijionsale.com uses credit card transactions with manual batch processing Kava, music, Jewelry, etc.
Example 4 - RetailArtifacts - Papua New Guineawww.niugini.com - PNG PortalSticky Features Forums, News, Chat, Postcards, Info pages Sells PNG artifacts.Transactions via email and bank transfersGreat product but management and operation issues and no online transactions.
RememberThe Internet is the best opportunity for Pacific Island business since the Jet Plane however:traditional business principles still matter online. Value to the customer comes first. Be realistic about revenues and costsFor the Pacific the initial market is overseasInitiative and creativity are premium.
PART IIAn ecommerce strategy for a SmallPacific Island Business By Taholo Kami for UNESCO
Objectives?Why get online? Promote awareness of your Organization Sell a product Customer support Information and contact page Networking Everyone else has a web page
PlanWhat is your product? Electronic, Services or physical Portable and inexpensive to deliver TourismWho is your market? Overseas Fish buyers Upper income art collectors Budget travellers / Up marketObstacles, Implementation and deadlines.
Getting OnlineHosting Your Website Fast Access Cost, Support, Space and ServicesChoosing a Domain Name (web address)www.myname.com / .nu / .to / .tv / .fj / Calling Card Choose name that relates to product Reflects on organization Easy to remember
Design IssuesOften Simple Is Better E.g. National PNG, Yahoo Complexity depends on your website objectivesPlanning content How do you keep content fresh and relevant Who Develops your website? Professional Services Do it Yourself
Web Site SoftwareWeb-site Creation Common Software Tools. Image Editing Adobe Photoshop Jasc.com Web Page Development Paintshop Microsoft Front page - $150 Dream Weaver - $150 – 200 Netscape Communicator-Free Note: There are a lot of cheaper software online.
Managing your Web SiteManaging your website can take TIME!Adapting Business processes Good Samaritan Inn example Look at employee time Customer expectations Limitations of the medium (non face to face)
Transactions1. Getting paid online is very difficult in the Pacific. Many banks will need a large deposit or a strong relationship to allow a SME to open a merchant / credit card processing account at a bank.Alternatives include: Bank transfer / wire Credit Cards Merchant account Manual / Automated processing Third party processing paypal.com
DeliveryDelivering an artifact after online purchase or attracting visitors to an eco tourism resort - managing expectations is essential People are used to guaranteed delivery but more importantly, communicate reality so expectations are realistic. E.g. Implement a 2 week guarantee for goods Ensure online advertisement meets expectations Use a reliable delivery service (TNT, FedEx)
Marketing Web siteHow do people find your website?ONLINE Strategy Links from related and / or popular web sites Search Engines Online Advertisements Informed by other users
Marketing Your WebsiteOFFLINE Strategy - Show Your URLwww.MYCOMPANY.com Stationary Advertising on conventional media Trade shows
ConclusionDespite infrastructure limitations in the Pacific, the target market in developed countries are likely to be Internet users.If unsure, start small. An existing website helps develop your capacity to interact with customers and measure web potential.Lobby Government for effective IT Strategy that develops infrastructure and builds local capacity.